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Adam Bannister is a contributor to IFSEC Global, having been in the role of Editor from 2014 through to November 2019. Adam also had stints as a journalist at cybersecurity publication, The Daily Swig, and as Managing Editor at Dynamis Online Media Group.
October 3, 2019


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Rogue traders

Fraudster found guilty of failing to pay staff at “phantom” security firms

Credit: Julian P Guffogg, licensed for reuse under Creative Commons Licence

A serial fraudster who ran seven security firms under four different identities has been found guilty of defrauding security operatives he employed.

John Gaines, 72, of Leamington Spa, failed to pay many security guards in full, with some not paid at all.

Gaines was found guilty of 22 charges of fraud at Warwick Crown Court on Monday 30 September.

Gaines told the court that payments were withheld because workers were either “asleep on the job” or had failed to provide proper documentation. However, a number of witnesses claimed that he refused to supply written contacts, ignored requests for payment and left threatening phone messages for those who he’d defrauded.

The guards, who were licensed by the Security Industry Authority (SIA), were employed at several sites, including construction sites belonging to Heathrow Airport and Tesco.

The court also found Gaines guilty of falsely claiming to be SIA-approved, despite not being a member of the SIA Approved Contractor Scheme.

“Various aliases”

“I am grateful to the jury for returning guilty verdicts on all 22 counts in this case,” said Nathan Salmon of the SIA’s criminal investigation team. “In part, private security regulation was introduced to address cowboy operators, and I can think of no better word to describe Gaines’ actions.

“Through various aliases and phantom businesses, Gaines set out to employ security operatives, withholding their pay whilst profiting from his contracts.  He employed new staff to replace those who left, continuing his fraudulent behaviour many times over.

“He sought to conceal his identity, hid behind wild excuses, and was threatening to some employees who were merely seeking payment for the work they did for him. The SIA recognised the harm Gaines was causing to regulated individuals within our industry, and I am grateful to the 21 employee victims who bravely came forward to secure this conviction.”

The SIA was alerted to Gaines’ fraudulent activity by a series of complaints submitted to police and Action Fraud. It then emerged that several companies subject to the complaints shared email addresses and phone numbers. The Government Agency Intelligence Network (GAIN) then relayed this information to the SIA.

An exhaustive SIA investigation traced several contracts spanning 2012 to early 2016 to one individual: John Wear Gaines, who had deployed various pseudonyms and company names.

Warwickshire Police arrested Gaines in October 2017 and seized material connecting him to the businesses and aliases under investigation. Hundreds of business cards and flyers found at Gaines’ house bore the names Geoff Caines, Robert Fox and David Ward – with the latter including the claim of being ‘SIA approved’.

Gaines ran most of the businesses as sole trading entities, virtually from his home. Just one, Crown/Accord Nationwide Security – under another alias, ‘Jeff Cains’ – was registered at Companies House.

Sentencing has been deferred to 14 November pending the creation of a pre-sentencing report.  Gaines has been remanded into custody in the meantime.

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